Immunosuppressive medications are essential in preventing kidney transplant rejection. Continuous insurance coverage for outpatient immunosuppressive medications remains a major issue. The objective of this analysis is to provide a rationale for, while estimating the economic implications associated with, extending Medicare coverage for immunosuppressive medications to those patients who lack coverage.

The data required for this analysis were obtained from existing sources, including the United States Renal Data System, as well as a survey of transplant centers conducted under the auspices of the American Society of Transplantation and the United Network for Organ Sharing.

The logic of the argument, and the data required to support it, is as follows:

The annual per-patient cost of immunosuppressive medications for transplant recipients is highly variable. Based on actuarial reports, an estimate of $19,000 per-patient per-year is reasonable.

There are approximately 173,000 living kidney transplant recipients, of which 13,480 do not have any source of coverage for their outpatient immunosuppressive medications. Extending Medicare coverage to these patients would cost $256.1 million a year.

It is estimated that about 3,800 kidney transplant recipients lose their grafts each year due to cost-related non-adherence. An individual graft failure has an episodic cost of $118,105. Thus, the aggregate annual cost of graft failures is $448.8 million.

Meanwhile, the per-patient per-year cost for a functioning transplant is $21,441. Therefore, if the aforementioned graft failures (3,800) did not occur, the aggregate cost would be $81.5 million to maintain functioning grafts.

The aggregate net cost of kidney transplant graft failures due to cost-related non-adherence is estimated to be $367.3 million ($448.8 million – $81.5 million). Consequently, the economic implications of extending Medicare coverage to those patients who do not have a source of insurance coverage are obvious: there is a net cost savings of at least $111.2 per year ($367.3 million – $256.1 million).

For over 25 years, insurance coverage and reimbursement for outpatient immunosuppressive medications has been a serious issue for kidney transplant recipients. Many recipients remain at risk of graft failure for cost-related reasons. Extending Medicare coverage to uninsured recipients yields a net cost savings, although “crowd-out” is a concern.

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